Hey friends,
In case you missed it, last week I announced the SmartMoneyKids project - an AI powered financial literacy app specifcially designed for Canadians. Today I have a demo for you, read on if you like. Otherwise, skip ahead to regular business.
Why am I doing this?
Because I'm a parent to one and soon to be two.
My greatest preoccupation in life is now the welfare and success of my family and children. Their future is front and centre to how this app is being built.
There is a design flaw in our education system. As much financial content as there is on the internet, the majority of adults still struggle with money and investing. One second they are motivated, the next they are gambling.
No Canadian kid should have to go through the disarming transition from being taken care of to getting slapped in the face at 18 when money becomes real.
SmartMoneyKids intends to solve this, starting from the ground up.
A number of you have signed up for the waitlist, and I truly appreciate your participation - stay tuned for separate communications when the beta testing is ready for launch.
Here is the 5 minute demo of the app and its user interface from both the parent perspective as well as the kid’s perspective. Note that video quality of the screen recording is unfortuantely not great - in real life it is sharp as can be!
Your input is important to me so please have a look (listen at 2x speed if you are busy).
Want to be part of how this develops?
Get on the Beta waitlist → smartmoneykids.ca
Early testers get first access and a direct line to shape what gets built.
Eddie
Personal Finance
Investing success relies on these three (3) factors:
Contributions
Rate of Return
Time
Let’s unpack:
Contributions: you will have no success investing if you never contribute anything. Earning a return on $0 = $0.
→ Therefore, you must earn more, spend less, invest the difference. This is the beginning and absolutely critical.
Rate of Return: you must earn a return on your investment for this to work. If you earn 0%, you lose +5% or more to inflation, every year. At that rate, money under the matress loses >50% in 15 years and >80% in 30 years.
→ Therefore, you must buy investments that increase at least at the rate of inflation (real estate, generally) or higher than inflation (stocks, generally).
Time:
if you invest $1,000,000 today but die tonight, it wasn’t worth it. Compound interest requires time. Invest $10,000 at 10% for 20 years = $67,000. Invest $10,000 at 10% for 40 years = $452,000. 20 years on either side. One half produced $57,000 of profit. The second half prodced $395,000 of profit.
→ Therefore, start early. The more time in the market earning compound interest, the faster your money will accelerate in the second half, which is always the more exciting part of the game anyway.
All critically important. You mess one of those up and you mess the entire thing up.
You need to invest early and as often as you can. Do your dardnest to keep contributing, and earn a satisfactory return along the way (low cost market ETFs are a great place to start). Then give it time to grow like a hockey stick.
Stock Markets
On the topic of some solid low cost ETFs, here are a few to consider that are very good at getting you exposure to the stock market. The t
iShares S&P500 ETF (hedged to C$)
Description: America’s largest stock market, removes C$/USD fluctuations
Ticker: XSP
MER: 0.09%
10 Yr annualized return: 13.76%
iShares S&P500 ETF (unhedged to C$)
Description: America’s largest stock market, C$/USD fluctuations impact returns
Ticker: XUS
MER: 0.09%
10 Yr annualized return: 15.17%
iShares TSX Composite ETF
Description: Canada’s largest stock market
Ticker: XIC
MER: 0.06%
10 Yr annualized return: 13.64%
Vanguard FTSE Developed All Cap ex North America Index ETF
Description: The world stock market, excluding Canada & US
Ticker: VIU
MER: 0.23%
10 Yr annualized return: 10.56%
** Obviously past performance does not guarantee future results. However, anyone using past results as a reason to dissuade you from long term investing should be avoided.
***MER stands for management expense ratio. A 0.09% MER means it costs $9 for each $10,000 invested in the SP500 ETF. Unreal deal, if you didn’t already think so.
1 Quote
"Doubt kills more dreams than failure ever will."
Suzy Kassem
A Question
Have you ever doubted yourself?
Me, yes, all the time…
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For Your Kids
Teaching your kids about money? SmartMoneyKids is an AI-powered financial literacy app for Canadian kids ages 6 to 18. RESP, TFSA, saving, investing, business, in language they actually understand. Join the waitlist.
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